The Dividend Puzzle; An Enigma 50 Years on

14 Pages Posted: 23 Sep 2011 Last revised: 27 Aug 2012

Date Written: September 21, 2011


This paper investigates over fifty years of the major dividend policy themes, from Litners 1956 theory that earnings drive dividends through to the great financial crises impacting on international and Australian companies dividend policies. The question of why companies pay dividends seems to have a fluid, interwoven, contradictory and everchanging nature. Black’s conclusion in 1976, that when it comes to dividends there is no clear cut answer, only a puzzle, is as relevant today as it was then.

Keywords: Dividend, Yield, Buyback, Repurchase, America, Australia

Suggested Citation

Thomson, Warren David, The Dividend Puzzle; An Enigma 50 Years on (September 21, 2011). Personal Finance & Investments (PF&I) 2011 Conference Paper. Available at SSRN: or

Warren David Thomson (Contact Author)

Griffith University ( email )

170 Kessels Road
Nathan, Queensland QLD 4111

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